No Left Turns

Kudos to the Big Mac (Owens, that is)

As for Julie’s query about coal-to-liquid below, I’m not sure what to make of this. I’ve had the coal-to-liquid people in my office saying they can do it profitably at an equivalent price of $50 a barrel for oil. But then they want Congress to give them massive loan guarantees because Wall Street won’t finance the development of coal-to-liquid plants. If the production costs are what they say they are, they shouldn’t need help from Washington, given current energy prices. So I’m agnostic about this.

Discussions - 3 Comments

Dan

Recall Steve the coal to oil project, {I suppose I can be counted one of that group, though I never was invited to any of "big coal" shindigs} would be competing against not just other companies or concerns, but other countries that nationalized their oil industries. They would be competing against Saudi Arabia, Russia, Venezuela and Mexico. That being the case, to even the playing field, the government should be able to step in and provide temporary assistance. Say the coal to oil plants start getting built, and to prevent them ever being completed OPEC preemptively drops the price of oil to make their completion cost prohibitive. In the face of such flagrant price manipulation, shouldn't the entire assets of the United States economy and polity step in to make such manipulation itself prohibitive.

Were the coal to oil plants competing against other companies, on an even playing field, where states aren't manipulating prices, but the ordinary laws of supply and demand prevail, then this whole idea of coal to oil wouldn't be necessary. It's PRECISELY because states have intervened and distorted the markets that it's wholly appropriate for the United States government to similarly intervene in the market, and this time enter to the injury of the OPEC powers, and to the benefit of the American citizen and the benefit of America's allies, such as Japan. The United States ought to intervene just to ameliorate the brutal damage such price manipulation is having on the economies and peoples of the 3d world. For that alone, humanitarian purposes if you will, the United States ought to devise a policy whereby her coal enters the market, and enters in a dominating way.

The United States should initiate a policy that sees her as the foremost energy exporter within a decade. A policy that begins to reverse America's trade imbalance, and a policy that starts seeing those dollars that move abroad return home, and not return home because petrokingdoms are buying America's banks and realty. She shouldn't content herself with mere energy independence, which is insufficiently ambitious, but she should seek to drive the petrokingdoms right out of the energy market. Our policy should be to effectively declare economic war upon the petrokingdoms, who fund and support war against the West.

Steve, you're not thinking big enough. Allow your imagination to expand. Allow yourself to see what strategic use could be made of America's coal resources, resources that dwarf the crude reserves of the Mideastern powers.

We could easily create a situation where instead of our President crawling to the sauds begging for them to increase production, the sauds are crawling to Washington begging us to establish some limits on the amount of coal to oil we're putting out on the market. Instead of us crying about what damage the price of crude is doing to our economy, we could see the sauds crying that our to coal to oil is destroying their economy.

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